President Morsi Ousted: First Democratically Elected Leader Under House Arrest

Members of the Muslim Brotherhood and supporters of Egypt's President Mohamed Mursi hold pictures of him as they react after the Egyptian army's statement was read out on state TV, at the Raba El-Adwyia mosque square in Cairo July 3, 2013.

Gen. Abdel-Fattah el-Sissi, the country's top military commander, told the country that Egypt's constitution had been suspended and Morsi had been replaced by the head of the constitutional court until new elections could be held. No timetable for those elections were spelled out.

The general warned the Egyptian people to protest peacefully and said the authorities would not tolerate any violence.

President Obama said the United States was "monitoring the very fluid situation in Egypt, and we believe that ultimately the future of Egypt can only be determined by the Egyptian people."

"Nevertheless, we are deeply concerned by the decision of the Egyptian Armed Forces to remove President [Morsi] and suspend the Egyptian constitution. I now call on the Egyptian military to move quickly and responsibly to return full authority back to a democratically elected civilian government as soon as possible through an inclusive and transparent process, and to avoid any arbitrary arrests of President [Morsi] and his supporters," Obama said in a statement.

"Given today's developments, I have also directed the relevant departments and agencies to review the implications under U.S. law for our assistance to the Government of Egypt."

The U.S. Embassy in Cairo ordered all non-essential staff and families out of Egypt. It also warned Americans against traveling to Egypt and urged Americans living in the country to leave.

The Pentagon said that U.S. Joint Chiefs Gen. Martin Dempsey had a phone conversation with his counterpart Lt. General. Sobhi on Monday morning.

"They discussed the need to protect U.S. citizens, to protect the Egyptian people, and the need for the Egyptian military to contribute to stability in an appropriate way," a defense official said.

The anti-Morsi protesters erupted in celebration with fireworks being shot into the sky, but earlier in the day armored vehicles were used to separate them from an enormous crowd of Morsi supporters.

Morsi, who has strong support from the Muslim Brotherhood, was the country's first democratically elected president following the ouster of Hosni Mubarak.

Sissi said the general had been urging national dialogue on Morsi since November and had met with the president on June 22, but they were rejected.

He said the generals have "agreed on a roadmap" and said the military would avoid politics.

Earlier in the day, in a statement was posted on the Egyptian Presidency Facebook page, Essam El-Haddad, Egypt's national security adviser called the on-going situation "a full military coup," and warned that it will only lead to more violence.

"Today only one thing matters. In this day and age no military coup can succeed in the face of sizeable popular force without considerable bloodshed. Who among you is ready to shoulder that blame?" he wrote.

"There are still people in Egypt who believe in their right to make a democratic choice. Hundreds of thousands of them have gathered in support of democracy and the presidency. And they will not leave in the face of this attack. To move them, there will have to be violence. It will either come from the army, the police, or the hired mercenaries. Either way there will be considerable bloodshed. And the message will resonate throughout the Muslim World loud and clear: democracy is not for Muslims," El-Haddad wrote.

Scenes in Egypt have been reminiscent of Egypt's "Arab Spring" more than two years ago, which overthrew Mubarak. Hundreds of thousands of Egyptians have again taken to the streets over the last few days, protesting Morsi's rule after one year in office and demanding that he step down. While most of the protests have been peaceful, there have been incidents of violence. At least 35 people have been killed, many during a gun battle at Cairo University on Tuesday night.

The military issued a statement two days ago warning Morsi that he must do something about the unrest or it will take action, setting up a showdown between the country's first democratically elected president and the powerful military.

On Tuesday, Morsi gave a defiant statement in response, vowing that any attempt by the army to take over would "lead to civil war." He said he would not step down, even if it cost him his life.

"If the price for safeguarding legitimacy is my blood, then I am prepared to sacrifice my blood for the cause of safety and legitimacy of this homeland," he told the country. "Do not be fooled. Do not fall into the trap. Do not abandon this legitimacy. I am the guardian of this legitimacy."

As the clock began ticking the Obama administration scrambled to respond to the growing conflict. From Tanzania on Tuesday, President Obama called Morsi and urged him to take steps to contain the situation, reminding the Egyptian president that while the United States is committed to the democratic process in Egypt, competency must play a role.

"Democracy is about more than elections; it is also about ensuring that the voices of all Egyptians are heard and represented by their government, including the many Egyptians demonstrating throughout the country," said a statement released by the White House reading out Obama's call with Morsi.

Secretary of State John Kerry, who has just returned from a Mideast trip, also placed a call to Egypt's Foreign Minister Mohamed Kamel Amir, who reportedly resigned from Morsi's cabinet on Tuesday.

Defense Secretary Chuck Hagel has also spoken to his counterpart in Egypt, Pentagon spokesman George Little confirms.